Low Offers on my listed properties-Is this the new reality?

Question

Hi All-

I rehabbed and listed three properties for sale. They are rehabbed to a high standard and my asking price is somewhat lower inferior comps.

I have received offers where buyers are either asking for 3% CC concession or offers that are at least 5--7% below the asking price. My counteroffers for full price offer is met with silence.

I am carrying a high debt burden due to some unseen repairs and I wonder if this is the new reality and whether I should accept a 20K haircut on each property before it gets any worse. On a positive note, there isn't much else for sale in these good locations.

Thoughts?

Joe S. · Answer

A counter offer at the exact same price could be considered a bit smug in the market we are heading into. Even a tiny reduction could show goodwill IMO.

Jackie Mann · Answer

Smart buyers know they have negotiating power in this market. However, buyers don't always know what a good, fair price is. People just want a deal and may think your starting price is the start of a negotiation.

You, on the other hand, started low and didn't leave yourself room to negotiate.

I recommend unlisting your property. Then, start with a new price that is based on what the property is worth. Then, you have wiggle room to negotiate down a few thousand.

In your mind, make your current price be the lowest price you're willing to negotiate down to.

Account Closed · Answer

I don’t know your market, but in general the housing market is slow from November-January. I think your difficulty selling has a lot to do with timing, not just a market shift.

Russell Brazil · Answer

You need to always be adjusting your pricing strategy to meet the market conditions. In Woodbridge in March, under pricing was the right strategy. Today, over pricing would be the correct strategy.

Mike Dymski · Answer

If your asking price is lower than inferior recent sales comps, they should sell near full ask but may need to negotiate a little in this market. The knife is falling though; so, even recent sales comps get stale as prices decline. If there is nothing wrong with the property or the marketing, the market will tell you the price.

Juan V Lopez · Answer

Hey @Jacob Beg, congrats on your 3 properties.

From what I'm seeing, what you stated is our current market. I invest in Las Vegas and Chicago. Even if your property is accurately priced (or even priced on the lower end), you're always going to attract lower offers.

Buyers know they have leverage right now and buyer agents are persuading would-be buyers by telling them they can offer under asking price.

These are ultimately your properties so only you know your holding costs and stresses of holding the properties. If money is a stressor, it might be a good idea to take the under-asking price offers (or at least meet them somewhere in the middle). Bite the bullet and live to invest another day. Wish you the best, brother.

Paul Smythe · Answer

5-7% doesn't strike me as that bad of a discount. Might be worth negotiating further, but I could see it being a lot worse.

Andrew Syrios · Answer

The market has certainly softened but I don't think this is the general reality. It may just be the property, submarket or bad luck. I hear from flippers and banks that properties are still moving. And while sales are down, it's not catastrophically down.

Robin Simon · Answer

Are you 100% committed to selling these or are you considering or open to keeping through BRRRR?

Matt Devincenzo · Answer

What price point, demographic for your area (entry, luxury) and how long have they been listed?

Low Offers on my listed properties-Is this the new reality?

Low Offers on my listed properties-Is this the new reality?

Most Popular Reply

17 Replies